GAZA and to a lesser extent the West Bank were de facto states. Both received Billions of Western Dollars and also aid from Israel. What did they do with the money? In Gaza they built tunnels, fired 1000s of rockets and acquired weapons to attack Israel.
It should be noted that Saudi and the UAE employ about 10 million foreign workers. However, just a very few are from Gaza or the West Bank. Saudi and the UAE know it would bring turmoil, death, and violence to their nations. They wisely do not want them.
A two state solution is a recipe for continued war against Israel.